A Study of How Technological Innovation Affects China's Economic Development

Abstract

Technological innovation is a crucial element and driving force behind the advancement of economic development. The two-way fixed effects model is used in this research to investigate how technological innovation influences economic development. The research period spans from 2011 to 2020 and includes 30 provinces, municipalities, and autonomous areas in China. The data used are from Chinas National Bureau of Statistics (NBSC). The empirical analysis led to the following conclusions: Economic development and technological innovation have a significant positive association; the higher the number of patents granted in a citys technological innovation output, the better the regional economic development. Technological innovation significantly and positively affects economic development in both the Eastern and Western areas. However, in terms of economic growth and technical innovation in China, the western area lags behind the eastern region. The government should increase financial investment and policy support in technology innovation and strengthen financial and tax support for new science and technology industries.